Edison Lithium Corp. (TSX-V:EDDY, OTCQB:EDDYF) has announced an arrangement agreement with its wholly-owned subsidiary, Edison Cobalt Corp (SpinCo), paving the way for a distribution of SpinCo's common shares to Edison shareholders. The distribution will occur through a statutory plan of arrangement.
The arrangement highlights include the distribution of approximately 18,553,916 common shares of SpinCo to Edison shareholders on a one-for-one basis. The company noted that the distribution will not alter Edison shareholders' holdings in the parent company.
The move is designed to allow capital markets to independently assess the value of SpinCo's Kittson Cobalt Property, distinct from Edison's lithium properties and alkali dispositions, Edison said in a statement.
Leading up to the arrangement's completion, both Edison and SpinCo will fulfill closing conditions related to a property purchase agreement, involving the transfer of property claims comprising the Kittson Cobalt Property to SpinCo.
Post-arrangement, Edison will maintain its interest in the Antofalla Salar and Pipanaco Salar lithium projects in Argentina, along with alkali dispositions, including a sodium sulfate project in the Province of Saskatchewan.
Upon completion of the arrangement, SpinCo plans to list its shares on the TSX Venture Exchange and aims to raise up to $1,500,000 through a private placement financing at $0.05 per security.
The arrangement is subject to shareholder approval at an annual general and special meeting scheduled for early 2024, along with approval from the British Columbia Supreme Court and the TSX Venture Exchange. While conditional approval has been obtained from the Exchange, Edison noted that the particulars of the arrangement are subject to prevailing market conditions, and there is no guarantee of completion.
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